WeeklyPhilippine Update

WEEKLY UPDATE WE TELL IT LIKE IT IS

VOLUME IX, NO. 47 November 19 - 23, 2018 ______PHIL. Copyright 2002

_ THE WALLACE BUSINESS FORUM, INC. accepts no liability for the accuracy of the data or for the editorial views contained in this report.__

Political

House approves P3.8 Tn budget for 2019 The House of Representatives approved the proposed P3.8 trillion national budget for 2019 "Quotes on 3rd and final reading. The approval came earlier than what was previously announced in of the Week" response to the request of the Senate. Representative Rolando Gutierrez Andaya said next year’s budget contains many amendments. One of the changes included the Presidential request to include P2 billion for military housing, which was added funds for the National Housing Authority. Rep. Andaya pointed out that programs and projects both the House and “This is not your business as usual subdivision the Senate intend to fund would be discussed when the 2 chambers reconcile their versions of political units but one with deep geopolitical repercussions especially since the Province of of the 2019 budget. He also said that all changes will be itemized and will be compliant with Palawan is right in the forefront of our West the Supreme Court decision outlawing pork barrel funds. Philippine Sea territory. Instead of having to face a single, strong provincial government ‘Imelda’s bail grant undermines poor Pinoys’ trust in courts’ which can mobilize the entire island in its own defense, China will now have the opportunity to The ’s (anti-graft court) granting of bail to former 1st lady and Ilocos Norte infiltrate and influence smaller local government Representative has undermined the trust of poor in the courts, Vice units.” President (VP) Leni Robredo said. VP Robredo again raised her concerns over the temporary freedom given to Marcos, noting that it bolsters the perception among Filipinos Senator Risa Hontiveros on voting against that justice favors the rich and powerful in the country. She reiterated that the bail set by the a measure that seeks to divide Palawan into 3 provinces. anti-graft court was a mere pittance compared to the billions of pesos the stole from the Filipinos. “We welcome the friendship of the People’s Republic of China. But this friendship should not Duterte fires DSWD undersecretaries come at the expense of the interests of our people and our nation. Our interests should President sacked 3 undersecretaries of the Department of Social Welfare always come first when we deepen relations and Development (DSWD). Executive Secretary confirmed that the with other nations, especially at a time when President terminated the appointments of Undersecretary for Protective Programs Mae Fe majority of our people continue to contend with Templa, Undersecretary for Promotive Programs Maria Lourdes Turalde-Jarabe and daily challenges brought about by elevated prices and lack of livelihood opportunities.” Undersecretary for Disaster Response Management Group Hope Hervilla. Executive Sec. Medialda said, the government expects the new secretary, Former Philippine Army chief Vice President Leni Robredo calling on the Rolando Bautista, to bring in his own team to provide better services to the public. administration to be transparent in agreements with China.

SWS: Filipinos reject gov’t inaction on China militarization of West “The arbitral ruling cannot be taken away from Philippine Sea us. It will be there forever. But meanwhile, who Majority of Filipinos think it is “not right” that the government is simply letting China expand will enforce it? There is no power on Earth its military presence in the West Philippine Sea, a Social Weather Stations (SWS) survey presently that cannot enforce it.” showed. In its 3Q survey released on the eve Chinese President Xi Jinping’s state visit to Presidential Spokesperson the country, SWS said 84% of Filipinos said it was not right for to simply allow on international arbitral tribunal ruling that Beijing to build and fortify its military outposts in the disputed territories. This is up by 3 recognized the sovereign rights points from 81% on SWS’ 2Q poll. The survey also found that the number of Filipinos who in the West Philippine Sea. thought that it was right for the government to strengthen its military capability, especially “For one to step up, there is no need for the the Philippine Navy, had also risen to 86% from the previous quarter’s 80%. Meanwhile, other to step out. The nation will benefit from those who believed that it was right for the government to bring the West Philippine Sea the combined skills of this good tandem. Two disputes to international bodies for a peaceful judicial settlement dropped to 71% from the workhorses are better than one.” previous quarter’s 74%. Nevertheless, 87% of Filipinos said it was important that the Senator Ralph Recto advising Senator Philippines regained control of the West Philippine Sea islands occupied by China. Honasan to retain Acting Secretary Eliseo Rio as his Senior Undersecretary in the DICT.

DISCLAIMER The articles in this Philippine Weekly Update (PWU) have been culled from various media sources. We cannot, therefore, vouch for the accuracy of what is reported.

The Wallace Business Forum, Inc. 1 Nov. 19 - 23, 2018 Weekly Update

PH, China sign MOU on joint gas, oil development Philippine and Chinese officials signed a memorandum of understanding FINANCIAL INDICATORS Latest Week Week-ago Year-ago (MOU) on joint oil and gas development in the West Philippine Sea. The MOU was among 29 agreements signed by Manila and Beijing at the T-Bill Rates (% November 14, 2018 average) start of Chinese President Xi Jinping’s 2-day state visit in the Philippines. Based on the 2-page draft China version of the agreement, the proposed 91-day 5.172 5.077 2.148 joint exploration for oil and gas would be in accordance with the 182-day 6.245 6.233 2.563 364-day 6.521 6.506 2.952 principles of “mutual respect, fairness and mutual benefit, flexibility and pragmatism and consensus through equal and friendly consultations.” PESO DEPOSIT RATES (% p.a., October 25 – 31, 2018) The draft agreement stipulates the establishment of an inter- governmental joint steering committee and an inter-entrepreneurial Savings Deposit 5.00 5.00 0.00 working group. The committee would be led by the foreign affairs and Time Deposit Below 1 year 4.07 2.95 1.84 energy departments of Philippines and China as well as other relevant 1 - 2 years 6.09 5.93 2.41 agencies. The joint exploration contract will be executed upon ratification Over 2 years 3.06 3.13 2.65 by the committee. DOLLAR DEPOSIT RATES (% p.a., October 25 – 31, 2018)

Senate to review deals with China Savings Deposit 0.25 0.26 0.20 The Senate will review the joint oil and gas exploration deal with China Time Deposit as well as 28 other agreements signed during the visit of Chinese 60 days & below 1.13 1.10 0.67 President Xi Jinping amid calls for transparency sparked by concerns 61-90 days 1.33 1.28 0.71 91-180 days 1.34 1.43 0.84 that these could compromise the country’s sovereignty or lead to a “debt 181 days & above 1.59 1.53 1.11 trap”. Senate President Pro Tempore Ralph Recto is set to file a resolution calling for a legislative review of the agreements, particularly LIBOR/SIBOR (% p.a., November 12 - 13, 2018) the memorandum of understanding (MOU) on joint oil and gas exploration in the West Philippine Sea.Presidential spokesman Salvador Libor 90 days 2.62 2.59 1.42 Sibor 90 days 1.76 1.64 1.13 Panelo promised to release details of the deals in due time or after the Libor 180 days 2.86 2.84 1.62 end of the Chinese leader’s state visit. Sibor 180 days 1.88 1.76 1.25

Economy FOREIGN EXCHANGE RATE (% p.a., November 16, 2018)

PDS Weighted Ave. (P/US$) 52.91 52.63 50.91 ‘Half of Filipino households vulnerable to poverty’ Blackmarket (P/US$) 52.71 52.94 51.25 Various socioeconomic and environmental shocks, such as inflation and PDS Weighted Ave. (P/EURO) 60.07 60.63 60.28 natural disasters, now threaten to sink more Filipino households into PRIME LENDING RATE (% p.a., November 16, 2018 average) poverty and keep them there if the government fails to institute needed interventions. In a new study titled “Vulnerability to Poverty in the Bank of America 7.55 7.55 6.03 Philippines: An examination of Trends from 2003 to 2015,” state-run BPI 7.93 7.88 5.50 think tank Philippine Institute for Development Studies (PIDS) research Citibank 6.03 6.04 4.34 fellows Jose Ramon Albert and Jana Flor Vizmanos said about 48.5% of BDO 8.19 8.13 5.44 Hong Kong & Shanghai Bank 5.60 6.87 4.05 Filipino households were found to be vulnerable to income poverty if ING Bank 5.95 5.95 5.08 affected by disasters. The number was double the official poverty Metrobank 6.50 6.50 5.50 incidence of 21.6% in 2015 — the portion of the population with per PNB 8.75 8.75 7.08 capita income less than the poverty threshold. The researchers added RCBC 6.88 6.88 5.63 that the government should broaden the scope of its poverty Security Bank 6.13 6.13 6.13 Standard Chartered Bank 4.55 4.55 4.03 assessment so it can design appropriate programs that can both pull the UCPB 7.25 7.25 6.00 poor out of their situation and protect the vulnerable population from Union Bank 6.00 6.00 6.00 sinking into poverty. L/C SELLING RATE-IMPORT (P/US$, November 16, 2018) Moody’s unit sees ‘strong’ GDP growth Bank of America 52.73 52.94 50.78 Slower inflation would help ensure that the Philippines can maintain BPI 53.10 53.10 51.00 above-6% economic growth in the coming years, Moody’s Analytics Citibank 52.60 52.82 50.75 said, amid signs that price pressures are now finally easing. The Equitable PCI Bank 52.60 53.00 50.95 Philippines remains on track to be among the fastest-growing economies Hong Kong & Shanghai Bank 52.80 53.36 51.56 in the region even as growth “slowed noticeably” to 6.1% in 3Q2018, ING Bank 53.41 53.05 50.95 Metrobank 52.85 53.10 51.00 coming from 6.2% in April-June and 6.6% logged in January-March. The PNB 52.90 53.17 51.05 deceleration came on the back of a softer pickup in private consumption, RCBC 52.85 53.10 51.00 which settled at 5.2% year-on-year coming from 5.9% the previous Standard Chartered Bank 52.90 53.15 51.05 quarter as multiyear-high inflation ate into households’ pockets. Security Bank 52.80 53.00 51.00 “Provided that overheating risks are contained, GDP (gross domestic UCPB 52.90 53.15 51.10 Union Bank 52.88 53.17 51.10 product) is projected to grow at a strong 6-7% pace over the next few years,” the unit of Moody’s Corp. and sister firm of credit rater Moody’s Investors Service, reported. *T-Bills transaction is every two weeks

The Wallace Business Forum, Inc. 2 Nov. 19 - 23, 2018 Weekly Update

Gov’t confident fiscal deficit to fall within target for 2018 The Department of Budget and Management (DBM) yesterday gave CORPORATE BRIEFS assurance that the national government would not breach its 2018 fiscal deficit ceiling on the back of projected higher revenues in 4Q2018. DBM A joint venture of the Ayala group’s AC Energy and Vietnam’s AMI Secretary is confident that the deficit-to-gross Renewables Energy Joint Stock Co. has tapped Chinese firm Jiangsu Seraphim Solar System to supply solar modules for 2 flagship projects with domestic product (GDP) ratio would not exceed the 3% target for the a combined generation capacity of 80 megawatts in Vietnam. One project is whole year, even as the deficit already reached this level as of 3Q. He the 30-megawatt BMT Solar Farm Project, which will be built at the Ea Phe explained that the deficit-to-GDP ratio is for the first 3 quarters and there and Krong Puk Commune, Krong Pac District, Dak Lak Province. The other is a 50-MW KH Solar Farm Project, which will be built at Cam An Nam is still a program deficit for 4Q. DBM Sec. Diokno also said expenditures Commune, Cam Lam District, Khanh Hoa Province. are also seen to slightly ease in 4Q as the government has already front-loaded its projects in the first 9 months. AirAsia, Inc. is launching a daily flight from its hub in Cebu to Macau starting Feb. 8, 2019. It is offering promotional all-in-fares from P1,390 1- way until Nov. 25, for travel period between Feb. 8 to March 30, 2019. RMB 6 Bn multi-tranche ‘panda’ sale eyed Earlier this month, AirAsia said it is adding 3 times weekly flights to Seoul The Philippines is looking to sell about 6 billion renminbi worth of bonds from Clark beginning Jan. 19, 2019. in several tranches over the next 2 years, after it signed a memorandum Ayala Land, Inc. (ALI) is expanding the mall inside its mixed-use estate of understanding (MoU) with China providing for its return to the “panda” Cloverleaf in Balintawak, Quezon City, as it looks to cater to the needs of debt market, the Department of Finance (DoF) said. DoF Secretary commuters traversing the area. The company said it targets to open phase 2 of Ayala Malls Cloverleaf by 2022, offering a gross leasable area (GLA) of Carlos Dominguez III and Bank of China (BoC) Chairman Chen Siqing around 40,000 square meters (sq.m.). signed the MoU on “panda” bond issuance, as part of the 29 agreements signed during the first day of China President Xi Jinping’s 2- Cirtek Holdings Philippines Corp. looks to deliver strong profit growth for 2018, after earnings doubled for the first 9 months of the year. The firm day state visit. The DoF said the panda bond MoU provided a “general reported a net income of $3.5 million in 3Q2018, 208% higher year-on- framework to facilitate cooperation between the DoF and the Chinese year. This followed a 31% uptick in sales to $33.6 million on the back of bank (BoC) on future issuances by the Philippines of renminbi- robust growth across all business units. denominated ‘panda’ bonds in the Chinese debt capital market.” The Cosco Capital Inc., the retail holding firm of Lucio Co, grew its net income DoF added that the MoU covers the Philippines’ plan to return to the 16.1% to P3.97 billion in the January-September period, driven by strong China Interbank Bond market in 2019, with a possible application for a retail spending. Its consolidated net income grew 16.8% to P6.27 billion multi-tranche RMB 6-billion bond issuance. during the period. Among the different businesses, the group’s grocery retailing businesses, Puregold Price Club Inc. and S&R Membership Shopping Club contributed 59% of total profits. In terms of revenues, With rate freeze, BSP seen to trim bank reserves Puregold Price Club and S&R Membership Shopping Club churned in P99.8 The Bangko Sentral ng Pilipinas (BSP) or central bank may no longer billion during the nine-month period, up 14%. raise policy rates in December as inflation is expected to ease toward Hyundai Asia Resources Inc. (HARI), said its sales finally picked up in the end of 2019, giving it space to bring down the reserve requirement October after months of decline. HARI said it sold a total of 3,578 units last for banks, the chief economist of the Bank of the Philippine Islands (BPI) October, up by 9.6% from the 3,266 units in the same month last year. Driving the growth in HARI’s total sales in October was the light commercial said. BPI lead economist Emilio Neri, Jr. said with the assumption that vehicle (LCV) segment with sales of 2,074 units this year, 79.9% higher average global oil prices would rise slower next year, headline inflation than the 1,153 units the previous year. HARI said the company’s sales would start to fall below 4% in 2019. This is based on the assumption performance is consistent with the overall demand for automotive vehicles in the country. that oil prices, as represented by West Texas Intermediate (WTI), may rise less than 5% in 2019 compared with the unusual surge of more than Max’s Group Inc. (MGI) posted a net income of P118.5 million in 3Q2018, 40% this year. He noted, however, that while the return of inflation to the up 32% year-on-year. This brought 9-month earnings to P450.6 million, 7% higher than the year before. MGI COO Ariel Fermin said the results 4% level would give the BSP some policy space, reducing policy rates demonstrate the benefits of enterprise-wide initiatives on accelerating talent would be premature unless the growth in consumer prices breaches the development and driving productivity. 2% level. Metro Pacific said its unit, Metpower Ventures Power Holdings Inc, through Surallah Biogas Ventures Corp, signed a deal to convert the waste Fitch Solutions: Pres. Duterte’s pivot has risks generated by food manufacturer Dole Philippines Inc. (DPI) into energy Manila’s warming ties with Beijing will likely yield economic benefits “in through the development of a P1-billion biogas system in South Cotabato. The project marks Metro Pacific’s entry into bio-energy and is seen to serve the near term,” but risks lurk behind such pivot especially if executed to as a catalyst for a “highly scalable” waste-to-energy platform. The facilities the exclusion of the Philippines’ traditional economic partners in the will produce about 50,000 megawatt-hour of clean energy yearly to be used West, Fitch Solutions said. Loan agreements which President Rodrigo by Dole for power generation and fossil fuel substitute. The project is seen to positively impact climate change through CO2 (carbon dioxide) emission Duterte’s government has so far signed with China include $62.09 reduction by approximately 100,000 tons per year. million for the Chico River Pump Irrigation Project in northern Luzon and $232.5 million for the New Centennial Water Source Kaliwa Dam Project Earnings of Rockwell Land Corp. gained 9% in 3Q2018, as higher income in Rizal which is designed to add to Metro Manila’s water supply. from its leasing segment offset the slight dip in sales of residential units. The company said net income attributable to equity holders of the parent Chinese President Xi Jinping’s state visit to the Philippines seemed climbed to P629 million in the July to September period, versus P576 million designed to make up for the slow progress in these pledges, as it was booked in the same period a year ago. Revenues in the same period picked highlighted by the signing of 29 bilateral deals — most of which turned up 5% to P4.15 billion. Bulk of this came from the sale of condominium units, which stood at P3.01 billion, 2% lower than the P3.07 billion posted out to be in broad strokes. last year.

Total S.A. remains bullish on its prospects in the country, with plans to Business double its retail network to 1,000 in 5 years. Total Philippines Corp. president and managing director Laurent Stouffe said that the company are Gov’t formally names Mislatel 3rd major telco aiming to double its retail presence in the Philippines in the next 5 years. He added that the target is 1,000 stations across the country within the The government declared as the country’s 3rd major timeframe. telecommunications service provider the Mislatel Group of China Telecommunications Corp, Dennis Uy’s Udenna Corp. and Chelsea

The Wallace Business Forum, Inc. 3 Nov. 19 - 23, 2018 Weekly Update

Logistics Holdings Corp., as well as franchise holder Islamic Telephone Company, Inc. (Mislatel), almost 2 weeks after it was announced provisional winner for completing the selection process. The chairman of the auction’s oversight committee, Department of Information and Communications Technology (DICT) Acting Secretary Eliseo Rio, Jr., said that Mislatel now has 90 days to submit its business and rollout plans, among other requirements, before it may receive its Certificate of Public Convenience and Necessity (CPCN) needed to operate as a telco.

Study finds Philippines’ talent competitiveness eroded The Philippines’ ability to develop, attract and retain highly skilled professionals worsened in 2018 due to a persistent job-skills mismatch despite increasing investments in education, according to the annual survey of Switzerland-based business school International Institute for Management Development’s (IMD) research arm. The country placed 55th out of 63 economies in the IMD World Competitiveness Center’s World Talent Ranking 2018 report, down 10 rungs from 45th in 2017. The report cited the Philippines’ overall strengths such as employee training, effective personal income tax rate, skilled labor, competent senior managers and language skills. At the same time, it cited the country’s top weaknesses in the areas of total public expenditure on education, pupil-teacher ratio in primary and secondary schools, remuneration in service professions and labor force growth.

Manila Bay Area seen overtaking Makati CBD by 2021 - Colliers Demand from foreign employees of offshore gaming firms is boosting the growth of the Metro Manila’s residential condominium market, particularly in the reclaimed area fronting Manila Bay. Colliers International revealed the Manila Bay Area accounted for 26% of the total delivery of units during 3Q0218, due to the completion of Monarch Parksuites developed by Anchor Land Holdings, Inc., and Palm Beach Villas developed by Federal Land Inc. The 2 projects added more than 1,200 units. More than 4,800 condominium units were completed during the period, Colliers said. The property consultancy firm is optimistic the full-year projection of 9,600 units will be achieved. By 2021, Colliers expects the Bay Area to overtake other business hubs, including Makati. It expects the Bay Area to have 29,500 completed units by 2021, versus Makati CBD’s 28,700.

PH among preferred investment destinations Investors have tagged the Philippines as one of their preferred Southeast Asian investment destinations, a Pricewaterhouse Coopers (PwC) Philippines executive said. “The Philippines remains to be an attractive investment destination and most investors operating within Asean actually tagged the Philippines as one of the ‘VIP’ economies,” PwC Managing Partner Mary Jade Roxas-Divinagracia explained. Citing the results of PwC’s Investors Pulse Survey, she said that a little over 75% of the financial investors polled were prioritizing the VIP countries of Vietnam, Indonesia and the Philippines. She pointed out that these countries account for 72.5% of the region’s population. Among other indicators, investors are also attracted to the 3 countries’ demographics which offers depth in the labor market, and a strong gross domestic product which contributes to higher consumption power. On the other hand, corruption, competition, finding the right business partner, political uncertainties, poor corporate governance and foreign exchange volatility were the top concerns with regards to the Philippines.

DICT, China Telecom eye cable landing station The government is looking to tap China Telecommunications Corp. — a member of a consortium recently named as the country’s third major telco — to build a cable landing station that an official said would further reduce a dependence on the PLDT-Globe duopoly. State-owned China Telecom signed a letter of intent with the Department of Information and Communications Technology (DICT) to explore the possibility of building a submarine cable system that will link the Philippines with Hong Kong and the U.S. The international gateway facility was said to be critical for world-class telecommunications.

Non-extension of TEZ incentives may adversely impact tourism competitiveness The possibility of not extending the grant of incentives given to Tourism Enterprise Zones (TEZ) is seen to put a dent in the competitiveness of the country’s tourism sector. “For us, it’s similar from what we see in the office (sector) from the PEZA (Philippine Economic Zone Authority) locators. That will definitely have a dent in the flow of tourism investments here,” Colliers International Philippines research manager Joey Roi Bondoc said. Finance Secretary Carlos Dominguez earlier said the Department of Finance (DOF) is not keen on extending the sunset period for the grant of incentives for TEZ, which will lapse next year. Mr. Bondoc said the DOF should carefully evaluate their decision and as it would have an impact on the flow of investments. Based on the 2017 Travel and Tourism Competitiveness report by the World Economic Forum (WEF), the Philippines slipped to the 79th rank, five spots lower than its ranking in 2015.

PH shines in terms of financial inclusion The Philippines is among the top countries in terms of financial inclusion, a global advisory group said, noting that local rules allow wider use of digital platforms to reach the unbanked. The Philippines ranked 4th among 55 nations in terms of financial inclusion, according to the 2018 Global Microscope of the Economist Intelligence Unit (EIU), making the country the best in Asia together with India, which shared the same global rank. Still, the Philippines saw its score slip to 72 (on a scale with 100 as best score) from 78 in 2016, when it ranked 3rd, again together with India. The report cited recent reforms introduced by the Bangko Sentral ng Pilipinas (BSP) or central bank which allowed more non-banks to offer more financial services to Filipinos, which they said opened up more avenues for the public to use formal channels for money transfers and payments.

The Wallace Business Forum, Inc. 4 Nov. 19 - 23, 2018 Weekly Update

Infrastructure

Gov’t overspends on infrastructure, exceeds 9-mo target Government spending on infrastructure exceeded its target in the first 9 months with President Rodrigo Duterte administration’s massive infrastructure program already in full swing, according to the Department of Budget and Management (DBM). According to the latest disbursement performance report of the DBM, spending on infrastructure and other capital outlays reached P570.8 billion as of end-September, 7.2% higher than the programmed amount of P532.6 billion for the period. This was likewise nearly 46% higher than the P391.2 billion actual infrastructure spending recorded in the same period last year. Infrastructure expenditure for September alone rose 21.6% to P65.2 billion from P53.6 billion in the same period last year. Government disbursements in the first 9 months increased 23.6% to P2.49 trillion from the P2.01 trillion recorded in the same period last year. DBM Secretary Benjamin Diokno said this is also 2.6% higher than the P2.427 trillion spending program of the government for the period.

Japan commits P95 Bn loan for 2 infra projects Japan has committed to provide ¥206 billion (P95 billion) worth of loans for 2 infrastructure projects under President Rodrigo Duterte’s ambitious infrastructure program, according to the Department of Finance (DOF). Philippine and Japanese officials conducted the exchange of notes on Tokyo’s ¥37.906 billion ($336.24 million) loan assistance for the Pasig-Marikina River Channel Improvement Project Phase IV, and the ¥167.199 billion ($1.413 billion) loan commitment for the North-South Commuter Railway (NCSR) Extension Project. The documents were signed by Department of Foreign Affairs Secretary Teodoro Locsin Jr. and Japanese Ambassador Koji Haneda following the 6th meeting of the Philippines-Japan Joint Committee on Infrastructure Development and Economic Cooperation in Pasay City. The loan for the Pasig-Marikina River Channel Improvement Project covers the final phase of the initiative, which seeks to mitigate the frequent flooding caused by the overflow of the Pasig-Marikina River.

Congresswatch

Bicameral body OKs rice tariffs A bicameral conference committee has approved a bill that imposes a tariff on rice aimed at bringing down the price of the staple and at reining in inflation, which has risen to a 9-year high over the past 2 months. Rice prices account for 10% of the country’s inflation, which rose to 6.7% in September and October. Retail prices of the staple surged over the past few months amid the depleted buffer stock of the National Food Authority (NFA), triggering calls for its abolition. The bill liberalizes rice importation by removing quantitative restrictions and instead imposing a tariff—35% for rice from other members of the Southeast Asian Nations (Asean) and 50% from non- Asean countries. The government think tank Philippine Institute for Development Studies (PIDS) expects the price of rice to decline due to improved supply and to competition among suppliers as a result of the imposition of tariff on imported rice.

House OKs tax amnesty bill on 3rd reading The House of Representatives approved on 3rd and final reading a bill which seeks to enhance revenue administration and tax collection in the country. Voting 213-7, the plenary approved House Bill 8544 or the Tax Amnesty Act of 2018, which is part of the comprehensive tax reform program under the administration of President Rodrigo Duterte. The measure primarily grants amnesty on estate taxes and allows general tax amnesty, which encompasses all national internal revenue taxes such as income tax, value-added tax, donor’s tax, percentage tax, documentary stamp tax, and excise tax, among others. Ways and Means Committee Chairman Estrellita Suansing said that the measure would give a chance to erring taxpayers “to come forward, start with a clean slate, and be 100% tax compliant in the future.” The government is projected to raise additional P114.8 billion immediate revenues, clear case backlogs in both administrative and court proceedings, and enhance revenue administrations by having a wider tax base.

PH firms may have perpetual corporate terms The House of Representatives has approved on 3rd reading The Revised Corporation Code of the Philippines, which includes provisions on perpetual corporate term instead of the current 50-year term, good governance and sustainability. Securities and Exchange Commission (SEC) chairperson Emilio Aquino welcomed the move, saying it would help improve the business environment in the country. Mr. Aquino said “a forever” term of corporate existence would mean that a corporation is a stable enterprise and investors are assured of a safer investment option. As an ease of doing business factor, there will be no need to amend the articles of incorporation to extend corporate life beyond the 50-year term in the present Corporation Code, he said.

The Wallace Business Forum, Inc. 5 Nov. 19 - 23, 2018